Panama Canal's promise surging

Experts say channel's expansion could be boon to area

DENNY SIMMONS / EBJ
Long stretches of Interstate 69 in Gibson and Pike counties have concrete work done. The completed highway could boost truck traffic through the Tri-State.

DENNY SIMMONS / Courier & Press

associated press
Expansion work seen here at the Pedro Miquel locks of the Panama Canal will allow larger ships to pass through, which could in turn boost shipping figures for Tri-State products from coal to vehicles to agricultural products.

AP2012

A ship sails at the Panama Canal near an area under construction as a part of its expansion project in Panama City in December 2011. Two new sets of locks, one on the Pacific and another on the Atlantic side of the canal, are part of the waterway's biggest expansion projects since it opened in 1914, which could increase the flow of Tri-State goods to India and China.
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AP2011

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DENNY SIMMONS / Courier & Press

Besides the Interstate 69 extension through Southwestern Indiana, the region's major motivator for future growth may be the expansion of the Panama Canal.

Though some economists in the nation predict the $5.25 billion canal project — aimed at enabling movement of larger vessels through the canal — won't have a big influence on the United States, some Evansville economic and trade experts believe the impact may be fairly significant.

"We won't know for sure until it's actually here," said Greg Wathen, president and chief executive officer of the Economic Development Coalition of Southwest Indiana. "But, we have companies that produce lots of coal in Indiana, Illinois and Kentucky that ship to India and China. We could literally see that market expand."

David Matthews of David Matthews Associates, an Evansville-based real estate appraisal and consulting firm, predicts there will be an increase in cargo containers transported on U.S. interstates after the Panama Canal expansion is completed.

He said he believes that will result in the need for more distribution centers in Evansville and the Tri-State.

"Once they get here, they will need some places to unload," he said. "I-69 will be a big part in that increase as well."

Both Matthews and Wathen agreed that the enlarged Panama Canal could result in an increase in the amount of agricultural products, vehicles and other locally manufactured goods that are sent abroad.

Wathen said a number of major companies in the United States feel pretty confident about the prospect of benefiting from the expansion of the canal, including Caterpillar Inc. and Procter & Gamble, which, he said, have opened regional headquarters in Panama.

"It will be incumbent on large ports to be able to handle more ships and more cargo. The challenges could have a very positive impact on Mount Vernon (Ind.)," Wathen said.

"It also will be a big thing for Texas and other states shipping out liquefied natural gas."

A Wall Street Journal report by Sameer C. Mohindru from Singapore says the Panama Canal program includes the construction of two new sets of locks — one on the canal's Pacific side and one on its Atlantic side.

The project is due to be completed by the end of 2014, said Maria Eugenia de Sanchez, a senior official of the Panama Canal Authority, in the WSJ report.

Vessels with a maximum draft of 50 feet and width of 160 feet will be able to pass through the canal after the expansion is completed. The current draft limit is 39.5 feet and the maximum width is 106 feet.

Nearly half of the funding for the expansion project has come through soft loans through multilateral agencies and the rest from internal revenue, said de Sanchez in the WSJ report.

Regarding the I-69 expansion, Wathen said he is stunned by how its construction has moved at such a rapid pace.

"It's impressive."

"By the end of 2016, the highway should be open from Port Huron, Mich., to Memphis, Tenn. That's pretty powerful."

Wathen said Economic Development Coalition of Southwest Indiana continues to promote the area's I-69 connection in its marketing materials.